How does a deductible plan work

Question: 
I’m hoping to save on my health insurance and have been told a deductible plan might be a lot cheaper, is this right? How does a deductible plan work?

Answer: 
Yes,
a health
plan with a deductible will ultimately lower your health
insurance premium. Generally,
the higher the deductible, the lower your premium will cost. If
you select a deductible plan, you will need to pay for your medical
treatment up to the deductible amount you have chosen. Deductible
amounts can vary, for example;
Bupa’s
Worldwide Health Options plan offers deductibles ranging from
US$425 to US$8,500. Once you have reached your deductible amount, the
insurance company will pay for the rest of your medical bill.

High
deductible plans are typically suited to those who are in good health
and looking for a plan that will protect them if they get sick or
injured unexpectedly. For example, a policy holder selects a health
plan with a high deductible amount of US$8,500
and, after
a serious accident, the policy holder is taken to hospital requiring
surgery for a broken leg. The total hospital bill is US$18,000. The
policy holder pays US$8,500 towards the medical bill and the
insurance company pays for the outstanding amount of US$9,500. During
recovery, the insurance company continues to pay for other medical
bills such as physiotherapy, follow up medical appointments and
prescriptions medications.

Deductibles
are usually applied in one of two ways: they can be paid
annually or per
medical condition. An annual deductible is more ideal
as once
you have reached your deductible amount, all health care costs are
covered for the remainder of the year
–
regardless of what medical condition you are claiming for. If your
deductible is applied per medical condition, then every medical
condition will start with a new deductible. For example,
if the policy holder requires treatment for a different condition,
they will have to pay the deductible amount before the insurance
company contributes towards the medical bill.

While
a high deductible plan will protect you against expensive medical
costs, everyday medical treatments will not be covered initially.
Before you reach your deductible, small medical expenses such as
doctor’s appointments, prescription medications, dentist check ups,
x-rays and other everyday health care expenses will be paid out of
pocket. So before you purchase a high deductible plan, it
is
important to consider your health care needs and the level of
coverage you require. Those who would like cover for everyday health
care treatments might be better off with a comprehensive outpatient
plan or a lower deductible option.

If
you are in relatively good health and are willing to pay a deductible
towards your medical treatments, then a deductible plan might be the
best option for you. Those who opt for a high deductible plan should
put some money aside (depending on the deductible amount), which can
range anywhere from US$50 to more than US$8,000.

For
more information about deductibles and other health insurance
benefits that Pacific Prime can offer you, or to receive
a free health insurance quote, please contact us today.